AT&T Sweetens Prepaid Smartphone Data Plans, But Not Enough

Consumers have an increasing appetite for wireless data whether they’re on a contract or not. AT&T responded Wednesday by doubling its data plans for prepaid customers to bring them more in line with competitors.

AT&T GoPhone data plans now offer 50MB per month for $5, 200MB for $15, and 1GB for $25. The move is aimed at getting more potential prepaid customers to consider a smartphone: Just as in a contracted plan, smartphones on prepaid accounts require a data plan, and that puts more money in the pockets of the carrier.

The packages debut on April 22, the company says.

How does GoPhone compare? Verizon offers a $30 monthly unlimited data plan for prepaid customers, while Virgin Mobile does the same (including 300 minutes of talk time) for $35 a month.

The prepaid champion though is T-Mobile, which offers an unlimited talk, text, and data plan for $50 a month. My colleague JR Raphael recently compared the prepaid plans of various carriers, and found T-Mobile one of the best. So AT&T still needs to do a bit more here to be truly competitive.

Prepaid Plan Popularity

Prepaid has become much more popular over the past few years as the U.S. mobile phone industry matures. The line is now blurred: It wasn’t too long ago that prepaid customers had to deal with shoddy, expensive, and/or poor phone selection. Now many carriers give the user the option to purchase top-end phones without the discount, and offer plans that are not much different from those available on contract.

AT&T needs to do better with its prepaid offering. 1GB of data is a pittance and could be consumed quickly by even an average user streaming video or audio. It also seems like a rip-off compared to contract data plans.

AT&T's prepaid users spend $25 to get that single gigabyte of data. On the other hand, the contract user gets 3GB of data for $30. Do a little math, and that contract user is paying only $10 per gigabyte. That’s quite the difference and doesn’t seem fair.

Yes, contract consumers should expect more for signing their mobile lives over for two years to a wireless carrier. At the same time, that carrier shouldn’t be taking advantage of someone just because they refuse to sign a contract, and that’s what this pricing seems like.

For that reason, AT&T still remains near the bottom of the heap when it comes to most bang for your prepaid buck.